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Subject:  Re: 3% is the new "4% rule"? Date:  10/8/2013  7:29 AM
Author:  2gifts Number:  73469 of 88771

Of course your SWR is only 3% if you're allowing a financial advisor or mutual fund manager to take 25% of your annual retirement withdrawal in fees (e.g., 4% withdrawal from a $1MM portfolio is $40,000. A 1% fee on $1MM is $10,000.) You can put together a diversified portfolio at Vanguard for about 10 basis points in annual fees.

I use a financial planner for a portion of our assets, and I handle his commission by including it in my retirement budget, so it is part of the 4% withdrawal. It's the same as including house insurance and medical expenses in my budget as these are planned expenses, and are already included.

So I don't look at it as you are presenting where you say it reduces your SWR. It really doesn't because it is part of those planned expenditures.

Yes, I'm sure I can put together a diversified portfolio without the financial planner, but I have a financial planner because DH has neither the interest nor the ability to do it, and so I am insuring that he has enough money if I predecease him.

I've made different decisions in my life than you have, and so my plans will naturally reflect that. That doesn't make my plans wrong, even though I choose to use a financial planner. It makes my plans different from yours, but certainly suitable for me.

And for the record, my financial planner is actually doing a better job than I am these days, and that's after his fee, so I am finding his services to be very worthwhile, and certainly something for which I am willing to pay, not unlike other services that I could probably do myself by prefer to outsource.
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